Energy markets are commodity markets that deal specifically with the trade and supply of energy. An energy market may be an electricity market, but can also refer to other sources of energy.
Dynamic electricity pricing, with prices changing at time intervals (e.g., hourly) based on supply and demand, provides a powerful incentive for electricity consumers to draw electricity or run loads when prices are low. In a traditional dynamic pricing scheme, a utility company may set forth a time schedule of price incentives to modify electricity consumption. Consumers may schedule deferrable loads (e.g., air conditioning, heating, charging electric vehicles, industrial processes, etc.) according to the time schedule of price incentives set forth by the utility company to reduce or minimize their (the consumer's) electricity bills.
In an energy market, electricity may be distributed to consumers, for example, by a utility company over an electrical grid. The utility company may source a supply of electricity for the grid from various power plants or generators, which may be based on non-renewable energy sources (e.g., nuclear, fossil, etc.) and/or renewable energy sources (e.g., wind, solar, tidal, etc.). The supply of electricity may not be assured at all times as the amount of electricity generated by the various power plants or generators may be subject to time-varying local conditions. For example, the amount of electricity generated by wind or solar power generators may be subject to local weather conditions (e.g., low wind or cloud cover, etc.), which can change with time in a day. To effectively utilize or add electricity generated by renewable energy sources to the supply of electricity for the electrical grid, the utility company may seek short term balancing of load and supply on the electrical grid. The utility company may, for example, set different electricity prices for different time intervals (e.g., during a 24 hour time period) to encourage increased consumption or demand during periods of abundant or assured supply and to encourage decreased consumption or demand during periods of tight or scarce supply. Consumers may also actively participate in the setting of prices in the energy market by trading or negotiating time flexibility in their electricity demand or draw for better prices. Consumer offers of flexibility in their electricity demand or draw from an electrical grid may include amount, price and time constraints. For example, an industrial consumer may offer to run an electricity-consuming industrial process (e.g., an electric oven) at a time of the utility company's choice within a time window (e.g., between 11 p.m. and 3 am). A residential customer may offer to modify or adjust room temperature control settings in his or her residence so that an electricity-consuming air-conditioning system loads or draws electricity from the electrical grid in an amount and at a time of the utility company's choice. A consumer may offer to recharge his or her electric vehicle on a time schedule of the utility company's choice as long as the vehicle battery is first at least half-charged and the price is 50% less than a regular price.
Like the consumers' offers of flexibility in electricity demand or draw, suppliers or producers of electricity may also make offers of flexibility in electricity supply to the electrical grid subject to amount, time and/or price constraints.
There is need for systems and methods for evaluating and integrating offers of flexible demand or supply in energy market pricing schemes for electricity delivered over an electrical grid.